RCG Dustin's Ballard Home
Anybody remember back about a year ago when Dustin Luther (the RCG head honcho) got a job down in SoCal and made a big deal about listing his home?
Although his posts don't indicate it, his original asking price was $495,000. You would think, of all people, that the owner of Seattle's premier real estate blog by real estate professionals, for real estate professionals, would know how to appropriately price his home.
And yet, the home languished on the market, and was pulled off by Dustin after a few months (who admitted to me that it was priced too high), intending to try again in 2007.
I got curious why we still hadn't heard any updates about it on RCG, so I pulled up the KC parcel record to see if he had sold it yet. Turns out he did sell it, back in January... for $451,500. That's nearly 10% lower than it was originally listed at. No wonder he never updated the RCG readers.
The Luther's owned a mortgage for the home for just over three years, and even at the reduced sales price, they averaged 12.75% appreciation each year, having originally paid "just" $315,000 for it. If they paid only a 3% buyer's agent fee plus excise taxes, they walked away with about $95,000.
Assuming a 30-year fixed at 5.8% with 20% down, from 2004 through 2006, they would have spent a grand total of approximately $48,000 on interest and taxes, for an actual profit of $47,000. Not too shabby. The financial returns on housing were indeed difficult to beat during this bubble.
Anybody want to take bets on whether they've jumped into the market and bought a house down in LA after the 1-year lease was up on their rental?
Although his posts don't indicate it, his original asking price was $495,000. You would think, of all people, that the owner of Seattle's premier real estate blog by real estate professionals, for real estate professionals, would know how to appropriately price his home.
And yet, the home languished on the market, and was pulled off by Dustin after a few months (who admitted to me that it was priced too high), intending to try again in 2007.
I got curious why we still hadn't heard any updates about it on RCG, so I pulled up the KC parcel record to see if he had sold it yet. Turns out he did sell it, back in January... for $451,500. That's nearly 10% lower than it was originally listed at. No wonder he never updated the RCG readers.
The Luther's owned a mortgage for the home for just over three years, and even at the reduced sales price, they averaged 12.75% appreciation each year, having originally paid "just" $315,000 for it. If they paid only a 3% buyer's agent fee plus excise taxes, they walked away with about $95,000.
Assuming a 30-year fixed at 5.8% with 20% down, from 2004 through 2006, they would have spent a grand total of approximately $48,000 on interest and taxes, for an actual profit of $47,000. Not too shabby. The financial returns on housing were indeed difficult to beat during this bubble.
Anybody want to take bets on whether they've jumped into the market and bought a house down in LA after the 1-year lease was up on their rental?
Comments
Transparency is a no-no in the RE biz. No one should know what anyone else pays, what an inspection report reveals, or anything else you should be happy to redundantly pay a $1000/hr to a "professional" to tell you.